Argentine subsid bucks economy

Musicals, concerts fuel boom

BUENOS AIRES — CIE’s Argentine face, Daniel Grinbank, is one of the group’s strongest assets, with 25 years of local experience, first as manager of rock icon Charly Garcia and then as an international concert promoter.

That experience has been at CIE’s disposal since 1998, when the Mexican group took control of Grinbank’s empire and pumped in $35 million in fresh resources, which mostly funded a diversification into theater.

After acquiring the rights from Disney to musical “Beauty and the Beast,” the partners last year launched “Les Miserables” locally, with “Chicago” and “The Phantom of The Opera” opening this year.

The idea is to “produce Broadway events, with Broadway quality,” Grinbank says.

CIE’s international circuit makes it possible to bear the heavy costs of such mega-productions, with the shows topping local B.O. rankings, he adds. “These were virgin territories. The public response exceeded the traditional levels of takings and attendance in each market.”

But Grinbank has not turned his back on concerts. Last year he brought Hanson and Lou Reed to Argentina. This year has seen visits by the Red Hot Chili Peppers, Sting and Iron Maiden, with Mark Knopfler due this month and the Backstreet Boys in April.

Grinbank declines to speculate on which activity is more important to the group’s bottom line. “The concerts reach higher peaks, but the theater is steadier. The shows are all proven hits, so it’s less risky than a concert where you gamble everything on one night.”

Other local assets include leading local radio station Rock & Pop, which Grinbank founded 17 years ago. Although not part of CIE’s traditional portfolio, the station’s success allowed it to take over five more local stations.

It also provides important synergies, with Grinbank describing radio backing as fundamental to the success of the groups’ latest concerts, which grossed $2.5 million over three nights, around three times as much as a rival event with leading international acts like R.E.M. and Oasis.

In fact, the impact of radio on concert and other event tickets sales has been such that CIE is seeking to enter the radio market in other territories.

The group also has produced several programs for America 2, the smallest local TV broadcaster.

“We believe it is increasingly important to focus on creating our own content,” Grinbank explains.

But he dispels the idea that this could mark the genesis of a multimedia empire, denying reports that the group is planning to move into magazine publishing and discounting the possibility of bidding for new TV licenses later this year.

That is partly due to a wait-and-see approach, as Argentina’s economic recession enters its 33rd month. Grinbank reckons smaller producers have been harder hit, but admits that “since we are in the leisure business, it’s logical that the situation affects us.”

CIE topper Alejandro Soberon acknowledges that entertainment isn’t recession-proof, but it is recession resistant, especially in markets where Sting, for example, doesn’t perform every year.

These days, Grinbank says, he spends almost half his life in Spain, where CIE has just signed deals to operate the two principal theaters on Madrid’s Gran Via.

But that doesn’t mean Argentina is on the back burner. Indeed, Grinbank predicts that “all our business areas will grow this year despite the crisis.”